Question
Use this information to answer all questions in this section. Mitch Co. bought a new machine on 8/1/25 for $10,000. The machine has a salvage
Use this information to answer all questions in this section.
Mitch Co. bought a new machine on 8/1/25 for $10,000. The machine has a salvage value of $1,000. The machines useful life is estimated at 5 years and it is estimated to produce a total of 500,000 units over its lifetime. Year end for Mitch Co. is 12/31.
Question 1 (3 points)
Saved
Assume Mitch Co. uses the straight-line method to calculate depreciation. How much depreciation expense would Mitch recognize in 2025?
Question 1 options:
| $750 |
| $1,800 |
| $2,000 |
| $2,250 |
Question 2 (3 points)
Assume Mitch Co. uses the straight-line method to calculate depreciation. How much depreciation expense would Mitch recognize in 2027?
Question 2 options:
| $720 |
| $1,800 |
| $2,000 |
| $2,250 |
Question 3 (3 points)
Assume Mitch Co. uses the activity method to calculate depreciation. The machine produced 125,000 units 2025. How much depreciation expense would Mitch recognize in 2025?
Question 3 options:
| $1,800 |
| $2,250 |
| $2,000 |
| $2,750 |
Question 4 (6 points)
Assume Mitch Co. uses the sum-of-the-years-digit method to calculate depreciation. How much depreciation expense would Mitch recognize in 2026?
Question 4 options:
| $3,000 |
| $2,750 |
| $2,400 |
| $2,000 |
Question 5 (6 points)
Assume Mitch Co. uses the double-declining method to calculate depreciation. How much depreciation expense would Mitch recognize in 2027?
Question 5 options:
| $3,000 |
| $2,400 |
| $2,000 |
| $2,750 |
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